Thursday, June 28, 2012

Memphis District to Lose $212 Million to Charter Schools by 2016

The story unfolding in Memphis around the consolidation of Memphis and Shelby County Schools gets more and more interesting. Today one of the Gates front men, Gary Shorb, published a plea in the Commercial-Appeal for all sides to come together to embrace what is essentially a resegregation merger plan written by the Gates Foundation and their political arm-twisting outfit, Stand On For Children (SFC). SFC has successfully led the anti-teacher, anti-child, and anti-parent fight for corporate education reform in Colorado, Ilinois, Massachusetts, and Tennessee. It is most interesting and the ultimate irony that the County Commission, which supports the "merger" plan, is now accusing outlying Shelby County towns of racism for planning to bail out on this corporate-sponsored apartheid plan for Memphis.

The mechanism for getting the "merger" done to benefit the corporate charter school industry was to get the ALEC controlled State Legislature to write a law, first, to create a Transition Planning Commission (TPC) to be the public face for the plan, as devised by the corporate foundations. Kenya Bradshaw, Executive Director of SFC, serves as Secretary on the Commission of 18 appointees (does anyone know who appointed them? the Gov,? Bill Gates?

Next came the meetings to gather "public input," right? And next came writing of the plan by the foundation lawyers and economists, with no further public input.

Well, the Plan was released a few days ago, and it is available on the Web. The Commercial Appeal has published none of the details, so I spent a bit of the morning poring through the 200 page plan.

Basically, it is plan that squeezes public funding to cover the costs of the hemorrhagic loss of revenue from shifting millions from public schools over to corporate charter operators with a free ride and no public oversight. Secondarily, it is a plan to replace experienced teachers in urban schools with nominally prepared neophytes who will ply their trade in apartheid total compliance corporate welfare charter schools. Thirdly, it is an attack on the teaching profession and job security. Fourthly, it is to a plan to privatize as many school services as possible in order and to cut benefits for the remaining public employees..

Here below are some choice tidbits with a few of my own comments. (My bolds within the text)

Overall
Shelby County public school enrollment is projected to decline 3% from FY2012
to FY2016, resulting in approximately 147,400 students enrolled in Shelby
County public schools by FY2016. The enrollment mix is expected to shift to
non-district operators (including charter schools and the ASD), from 4% of
total public school enrollment in FY2012 to 19% in FY2016, resulting in approximately 118,700 students enrolled in district-operated schools by FY2016
(p. 13).

The
Committee developed these priorities and recommendations with the understanding
that Shelby County
Schools will not be structured like a traditional school district in 2013–14.
With the growth of the
Achievement School District (ASD), the Innovation Zone, and charter schools,
the district will be a mix
of school operators and types. The TPC recognizes that the district does not, and
should not, have the authority to mandate some
of the recommendations below in charter schools and the ASD (p. 31).

The details on the Achievement School District are not complete, but it will essentially operate without local control or oversight. It will be run out of Nashville, and it will replace the lowest scoring (poorest) public schools in the state with corporate charters.

Some details on the cost of the new
Gates-Walton-Edelman Plan:

Cost Management of Enrollment
Shifts

Summary

A system with multiple school
operators (e.g. District, ASD and charter schools) inherently costs more to
operate due to loss of scale with fixed costs being allocated across a smaller
volume of students. This multi-operator environment is in place today and is
projected to expand irrespective of the merger. To date, the districts have
found creative ways to manage the increased costs of the existing multi-operator
system (e.g. cutting or shifting 400+ positions out of the General Fund to
right-size staff). However, with the
projected share of students in non-district operated schools expandingrapidly in the next few years—from
approximately 4% in FY2012 to 19% by FY2016 (equivalent toapproximately $212M of revenues shifted to
charter schools and the ASD in FY2016)—it is critical to implement
strategic cost management to ensure each pathway in the Multiple Achievement Paths
model is financially equitable to students. The majority of these enrollment
shifts are projected to happen irrespective of the merger, and the increased
cost of the system is not the “fault” of the district or charter schools.
Although merged SCS will continue to be responsible for managing most of these costs,
other operators will also contribute as participants who benefit from this
overall system (p. 168).

Here are some specifics from the Plan with details
about what they mean. Note that almost
400 public school teachers will be lost in the first 3 years, and the Stand on Children folks are
planning to make sure that these teachers lose the opportunity to transfer to
the charter system being planned for urban Memphis. One of
the new priorities for the ALEC owned State Legislature will be “Repealing TCA § 49-5-511 which requires districts to
place tenured teachers on a preferred reemployment list if they lose their jobs
due to a reduction in force” (p. 195):

• From FY2012 to FY2014, the
shift of an estimated 9,500 students from district-operated schools to other
operators (e.g. charter schools, ASD) will result in a shift of approximately
$70M in revenues. Charter school revenue share will continue to be a
pass-through to the district and ASD revenue share is expected to be directly
provided by the State.

• If the merged SCS aggressively
implements a set of management practices to manage its school and staffing
footprint, it can recover an estimated $58M. This assumes 85% of step-variable costs
can be recovered with the district pursuing regular staff right-sizing and
active management to hold student-teacher ratios constant. For example, with an estimated declineor shift of 9,500 students from FY2012 to Fy2014, the district will
have to make the followingtypes of
approximate reductions—390 general education teachers, 60 elective and
vocationalteachers, 50 clerks, and
15 central office positions—keeping in mind that new teaching andother employment opportunities would be
created in the ASD and charter schools.

• Other operators’ paying for
benefits received (e.g. utilities and maintenance in shared facilities, shared
staff, shared services) can help contribute approximately $3M (see Operations
Plan chapter for more details on
shared services). [Presently, TN state law requires charter operators to pay
nothing for these services provided by local districts]

• A modest and differentiated
contribution from other operators of an estimated 4% (blended average across
operator types ranging from 0% to 7% depending on specific choices made by the
operators, e.g. full conversion of existing attendance zone in existing
facilities contribute 0%, lottery system in existing facilities contribute 5%
if choose to share school-level costs) can help recover a further approximately
$3M. Enforcing contributions will require a legislative change as current
Tennessee law does not allow charter school authorizers to require charter schools
to contribute to district overhead. Note that benchmarks of other large urban
districts show contributions to range from 2% (Denver) up to 20% (Chicago) (p. 171).

Even if all the cost savings
can be implemented, including privatizing custodial and transportation operations
and turning over the keys of 21 public schools to charter school operators, the
TPC still projects a $57 million deficit in FY 2016. Below is the wish list that the TPC has
developed to try to close the gap created by the drain of education dollars
into the corporate charter schools and ASD charter schools. Note that there is presently no state law requiring
charter operators to pay for any shared services, either utility bills,
transportation costs, or shared librarians, for instance.

City, county, and state
action

There are a number of
outstanding issues that require city council, county commission, or state action.

These include:

• Securing the $55M in funding
from the City of Memphis

• Waiving the Shelby County
residency requirement for all SCS employees, given the number of current MCS employees who do
not reside in Shelby County

• Ensuring that all operators
(e.g. district, charter schools, ASD) receive state and local funds in the same timeframe

• Seeking definitive clarity from
the state on to whom the "leveling up" requirement of the Norris
Todd Act applies, and securing an agreement on that definition

• Advocating for the legislature
to implement the approved changes to BEP funding, and for the proposed changes made by the
BEP Review Committee. There are reforms passed in the State BEP 2.0 formula that are
pending funding for full implementation. Some of these reforms, including an increase in the
State share for instructional components in the formula from 70%to 75%, could yield as much as
$30M in incremental revenue.

• Advocating for the state to
provide funding during the merger transition period, per TCA § 49-2-1207 (5), and/or TCA §
49-2-1262

• Advocating for the legislature
to approve a charter school and ASD holdback, and charter school attendance zones

• Repealing TCA § 49-5-511 which
requires districts to place tenured teachers on a preferred reemployment list
if they lose their jobs due to a reduction in force.

Now if the wish list does not
lead to the desired funds, then the TPC has a contingency plan to pay for the
ridiculous and needless and expensive turnover of 20 percent of Memphis schools
to charter operators. Here it is:

Contingency Plan

If all four recommendations for
additional funding have been exhausted and a budget deficit remains, the TPC
has identified potential incremental cost reductions worth $48M as a reluctant
contingency plan. This contingency plan is not a recommendation of the TPC. The
TPC believes that these types of reductions, which would increase class size
and reduce school-level staff, undermine the potential of the Plan to create a
world-class educational system, and should only be pursued as an absolute last resort.

The exact initiatives would
need to be identified by the district-led working committee; however, some illustrative
examples are detailed below. These examples total $48M in annual savings.

• Shifting to State minimum ratio
of librarians which would result in a $5.5 additional annual savings from about 115 fewer
librarians

• Retracting investment in
additional Assistant Principals and shifting toward a 'SCS minus one' staffing model which would
provide an additional $11.4M in annual savings from eliminating close to 100 AP positions

• 15% reduction in other school
staff positions (e.g., clerks, educational assistants, therapists) for an annual savings of $10.5M

• Moving to a student-teacher
ratio of 'MCS plus one' for an annual savings of $20M resulting from eliminating 280 teachers
(p. 177).